An increase in the rent that a firm pays for its factory does not increase ______
A. total cost
B. fixed cost
C. marginal cost
D. average fixed cost
C Rent is a fixed cost, so an increase in the rent increases fixed cost, total cost, and average fixed cost. But it does not change the marginal cost because fixed costs have no influence on the marginal cost.
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Please use a figure to discuss whether or not a devaluation under a fixed exchange rate has the same long-run effect as a proportional increase in the money supply under a floating rate
What will be an ideal response?
Which of the following is a difference between the theories of John Maynard Keynes and the classical economists?
a. Unlike Keynesian economists, classical economists believed that unemployment was a serious long-term problem. b. Unlike Keynesian economists, classical economists advocated that the economy was always in equilibrium. c. Unlike Keynesian economists, classical economists believed that the economy would always settle at full employment. d. Unlike Keynesian economists, classical economists did not believe that the economy was always in equilibrium. e. Unlike Keynesian economists, classical economists believed a glut created an unemployment problem for the economy.
Which of the following is a reason that some economists do not agree with the concept of a labor-leisure tradeoff?
a. Wages are paid in dollars and leisure is measured in time, hence there is no way to compare the two. b. On a day-to-day basis, most jobs do not have the flexibility to allow people to weigh the benefits and costs to determine how much they should work that day. c. In the long-run, the supply of labor hours is perfectly inelastic. d. An increase in the wage rate always leads to an increase in the supply of labor hours, therefore the workers do not think of choosing leisure over labor. e. Some people do not work at all, so there is no labor-leisure tradeoff for those individuals.
Economic growth is likely to be faster when
a. higher tax rates are imposed on high income individuals in order to provide greater cash payments to the poor.
b. domestic markets are opened to foreign sellers and foreign investors.
c. the supply of money is increased rapidly so individuals have more money to spend.
d. dramatic changes in political and legal institutions occur often.